Massachusetts News: BOSTON, Kelly A. Lynch, Former Controller of Small Business Pleads Guilty to Stealing Over $229,000

BOSTON, Ms. – A Boston woman pleaded guilty today in federal court in Boston to bank fraud in connection with the embezzlement of over $229,000 from a small business that employed her.

Kelly A. Lynch, 40, pleaded guilty to one count of bank fraud. U.S. District Court Judge Indira Talwani scheduled sentencing for Oct. 9, 2018. In February 2018, Lynch was arrested and charged by criminal complaint and subsequently released on conditions.

Lynch was hired in April 2017 as the controller of a small company in a Boston suburb. Her duties included managing incoming invoices, paying bills by check and wire transfer, bookkeeping and financial account maintenance. As a result, Lynch had access to the company’s checkbook, bookkeeping/accounting software (QuickBooks), and online bank accounts.

From April 2017 until her termination in January 2018, Lynch stole funds from the business for her personal use. Specifically, Lynch wrote unauthorized checks to herself using the company checkbook. Some of the checks were pre-signed, blank checks that one of the founders had signed with the intention that Lynch would later use them for business purposes.

After she used those checks, Lynch began signing the company checks herself, forging the founder’s signature. At times, Lynch also added an entry to the memo line to indicate that the funds were for “Consulting Fees,” but as a salaried employee, Lynch was not entitled to consulting fees. Lynch then endorsed the checks she wrote to herself and – without authorization and for no business purpose – deposited them in her personal bank account. In total, Lynch stole approximately $141,845 from the company’s bank account in this manner.

During approximately the same time period, Lynch repeatedly logged onto the company’s online bank account and directed that payments be made via transfer to her personal credit cards. As a result, Lynch stole another $87,243 from the company’s bank account.

The charge of bank fraud provides for a sentence of no greater than 30 years in prison, three years of supervised release, a fine of up to $1 million, restitution and forfeiture. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Office, made the announcement today. Assistant U.S. Attorney Amy Harman Burkart, Chief of Lelling’s Cybercrimes Unit, is prosecuting the case.